Strong Retail Sales and Weak German Data Boost Dollar

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Strong Retail Sales and Weak German Data Boost Dollar

APRIL 18, 2019

The U.S. dollar shot to life overnight, shaking off the tight ranges experienced all week.

Overview

Expect a busy morning on the economic and political front today.

This morning’s docket should give the greenback an added boost.  U.S. retail sales gained by the most since late 2017.  Overall sales rose 1.6% in March following a decrease of 0.2% in February.  Later, Markit’s PMI will cross the wire and traders will compare those readings to the disappointment data in Europe.

Expect some sparks to fly in Washington this morning as well.  Attorney General Barr will hold a press conference at 9:30 a.m. and is expected to discuss three topics before he releases the redacted Mueller report. Those include executive privilege and whether it has been invoked, White House interactions with the Justice Department over the past few weeks and the redaction process.  The redacted report is expected to be released sometime between 11 a.m. and noon today.  It is unknown whether the report’s contents will have an effect on the dollar but it bears watching.

Markets in Mexico will be closed today and Friday and Most European markets will be closed on Friday and Monday of next week so expect liquidity to dry up somewhat towards the end of the week.

What to Watch Today…

  • Markit PMI at 9:45 a.m.

Complete Economic Calendar can be found here.

EUR

The Euro slumped to a ten-day low against the U.S. dollar following disappointing economic data.  Manufacturing in Europe’s largest economy, Germany, fell more than expected and registered at 44.5 in April.  A reading below 50 shows a contraction. German Service PMI was up but were unable to save the Euro from decline.   Overall, Eurozone PMI missed expectations adding additional selling pressure. 

SEK

The Swedish krona came under pressure and weakened nearly a percent versus the U.S. dollar. Sweden’s unemployment rate jumped to 7.1%, considerably higher than the 6.6% reading expected by economists.  The krona is currently at a two-week low against the greenback.

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